Speaking of wages growth, I didn't realise that the Morrison budget projects the government going back into surplus in four years on the back of some pretty extraordinary figures... namely that wages growth will bounce back from below 2% (where it is now) back to 3.75% p/a, seemingly that's going to happen very soon according to their projections (ABC).

Back into surplus within 4 years has been the catch cry of every budget speech since 2010.

Its about time we the people demanded that who ever wins the next election they must balance the budget within 3 years or resign. The opposition (regardless which side), must support, not block bills aimed at balancing the budget.

I know this is not possible but for crying out loud, do we need to exceed $1T in debt before anyone actually gives a crap?

Speaking of wages growth, I didn't realise that the Morrison budget projects the government going back into surplus in four years on the back of some pretty extraordinary figures... namely that wages growth will bounce back from below 2% (where it is now) back to 3.75% p/a, seemingly that's going to happen very soon according to their projections (ABC).

Back into surplus within 4 years has been the catch cry of every budget speech since 2010.

Its about time we the people demanded that who ever wins the next election they must balance the budget within 3 years or resign. The opposition (regardless which side), must support, not block bills aimed at balancing the budget.

I know this is not possible but for crying out loud, do we need to exceed $1T in debt before anyone actually gives a crap?

Government debt is nothing compared to current private borrowings. Unlike the government debt, which we can still afford to pay off, private debt is just waiting for some adjustment to occur which will be disastrous for all these punters that have geared up their home asset to get into the property market or have no capacity to pay higher interest rates (20% will go under with a 2% rise) once they start rising. But they never learn from history and a new bunch of fools think they are going to become multi-millionaires.

Wages won't grow while there are people who are underemployed or unemployed (and I mean the genuine job seekers who treat unemployment benefits like income insurance not those who consider it their lifetime wage).  Also still importing 457 visa holders into 'skilled positions' when there is already a high ratio of unemployed in that area doesn't help.

For example the last time the IT industry hired all graduates that wanted an IT career was 1998.  There are also talented IT Professionals running coffee shops etc as our big businesses (such as the banks) 'offshore' the work.  Did you know that for at least 2 of the big banks your mortgage paperwork is actually processed in India or the Philippines.  That new computer centres as being built by NAB and others will have one on-site employee (The security guard) and will actually be controlled by 'offshore employees'

However as the companies are Australian the Australian Computer Society includes those numbers in its Australian IT Jobs tally then claims there is a shortage so lets them in on Visa's as well.  Which independent authority checks these figures - the Australian Computer Society of course

Government debt is nothing compared to current private borrowings. Unlike the government debt, which we can still afford to pay off, private debt is just waiting for some adjustment to occur which will be disastrous for all these punters that have geared up their home asset to get into the property market or have no capacity to pay higher interest rates (20% will go under with a 2% rise) once they start rising. But they never learn from history and a new bunch of fools think they are going to become multi-millionaires.

Agree the govt debt could get alot worse, but doesn't need too and is just a waste of taxpayers money to pay interest. This year the fed govt will pay more interest than the cost of building the Inland (could probably electrify it). Yes some of the feds debt is "good debt", ie that its being used to fund investments/infrastructure that will generate a position cash flow to the economy, however alot was used to fund the general spending such as salaries and welfare.

The fed's budget position and ongoing debt is also getting sensitive to a significant economic downturn, ie they will have limited spending capacity to repair and rebuild a economy entering recession. Rudd entered the GST with a budget significantly in the black and a large amount of banked cash to absorb the loss of revenue and increase in expenses. Now they are already $30B in the red, so where would a recession put us? $50-70B deficit?

Agree, the private debt is very high and strangling the economy, again limiting the direction the economy can go if there was a downturn and increasing the sensitivity of the economy to even a small hicup..

Wages won't grow while there are people who are underemployed or unemployed (and I mean the genuine job seekers who treat unemployment benefits like income insurance not those who consider it their lifetime wage).  Also still importing 457 visa holders into 'skilled positions' when there is already a high ratio of unemployed in that area doesn't help.

For example the last time the IT industry hired all graduates that wanted an IT career was 1998.  There are also talented IT Professionals running coffee shops etc as our big businesses (such as the banks) 'offshore' the work.  Did you know that for at least 2 of the big banks your mortgage paperwork is actually processed in India or the Philippines.  That new computer centres as being built by NAB and others will have one on-site employee (The security guard) and will actually be controlled by 'offshore employees'

However as the companies are Australian the Australian Computer Society includes those numbers in its Australian IT Jobs tally then claims there is a shortage so lets them in on Visa's as well.  Which independent authority checks these figures - the Australian Computer Society of course

The IT industry grew rapidly in the 90's and ran head first into the rapid global roll out of high capacity optic fibre technology. The bulk of my IT lectures in the early 90's were not even tertiary qualified and by the early 2000's, companies were already rolling out off-shoring basic IT tasks. The IT sector was probably the 1st sector to be exposed to the global(lower cost country) market on home soil, ironically as a result of technology development by the IT sector. Other industries just closed and relocated off-shore. ie remote support services based in India servicing Australia on shore via the internet.

The fact that they didn't get full employment of graduates since 1998 and not even during the mining boom demonstrates that the supply is exceeding what the market is willing to pay, ie too many/too high salary. Also note I doubt there is a field of study that rarely gets 100% recruitment of graduates.

Hence wages growth will be non-existent in some sectors while the same job can be easily undertaken off-shore in a lower cost country just as easily as onshore. Welcome to the Global market. I'm sure there are also very talented car assembly workers in similar coffee shops. Basically what I am saying is what you have said has happened to the IT sector has already happened in numerous other sectors before it and the only way things will change is to allow market forces to continue to push down wages in that sector unless it equalises with the off-shore cost, closes or offers greater productivity than the off-shore competitor. The only good news is that wages growth in India and Phillipines is often double digit and thus their costs are rising with Phillipines already ripping work out of India.

Overall much of Australian wages growth will continue to be slow because much of the Australian workforce is still over paid in USD term and the correction has yet to be completed. Further reduction in the exchange rate would help and the expectation was high 60's to low 70's, but other drivers kept it a bit higher.

There is however alot of good news as parts of the economy and new economy not easily off-shored or with sufficient levels of productivity to compete OS is doing well and paying well and part of the reason for the AUD:USD.

This has nothing to do with the economy,it's far more important.



http://www.afr.com/brand/rear-window/public-want-first-qantas-dreamliner-named-david-boon-20170520-gw9iis

Ooops , google it and you'll find it.

This has nothing to do with the economy,it's far more important.



http://www.afr.com/brand/rear-window/public-want-first-qantas-dreamliner-named-david-boon-20170520-gw9iis

Didn't they learn from the Boaty McBoatface debacle!

I know this is not possible but for crying out loud, do we need to exceed $1T in debt before anyone actually gives a crap?

Revenue is collapsing because wages are collapsing, a balanced budget is just not going to happen. Even if Morrison cut hard and deep they probably still couldn't turn that situation around - in fact, I'd argue that if they did that it would probably accelerate the slump because so much of our economy depends on that government spending.

Welcome to the Global market.

Malcolm should drive around Elizabeth and Salisbury shouting that from the top of his lungs; it's not our fault you're all stuck in a poverty trap on the dole - it's a global market, don't you know.

...

However as the companies are Australian the Australian Computer Society includes those numbers in its Australian IT Jobs tally then claims there is a shortage so lets them in on Visa's as well.  Which independent authority checks these figures - the Australian Computer Society of course

My mate who is an experienced Engineer complains about the same rort happening with the Engineers Society (whatever it's called) making money out of assessing overseas trained graduates and then letting them flood into the local market; simply too many people competing for too-few jobs in the Australian market and yet apparently Engineering is still on the skilled shortage list (why?). He tells me that every week he has domestic graduates coming to him and offering to work for nothing just to get experience. Terrible times for some professions when you can't even give your labour away; I feel for those people who spend many years at university doing something they're passionate about only to find that their field is impossible to find paid work in.

I know this is not possible but for crying out loud, do we need to exceed $1T in debt before anyone actually gives a crap?

Revenue is collapsing because wages are collapsing, a balanced budget is just not going to happen. Even if Morrison cut hard and deep they probably still couldn't turn that situation around - in fact, I'd argue that if they did that it would probably accelerate the slump because so much of our economy depends on that government spending.

Welcome to the Global market.

Malcolm should drive around Elizabeth and Salisbury shouting that from the top of his lungs; it's not our fault you're all stuck in a poverty trap on the dole - it's a global market, don't you know.

Agree, that the excuse for not bringing the budget back to balance for last 7 years has been to prevent a recession and I have supported this on the premise it would bring the economy down slowly, prevent a recession and balance the budget with growth. However if we had that recession, that would have come and gone by now and we operating with a balanced budget and debt probably far less than today.

At what point when do we say, "enough"!!! We are operating with a perpetual deficit.

The problem is that the fed govt budget has so much built in cost with welfare, NDIS etc etc etc that they have little room to move with easy cuts and significant cost savings were previously blocked by the senate.

The country needs to weed off anyone above 50% income earner from welfare and at the same time potentially find cuts to the lower end to enable the current costs from growing.

PLUS

raise income through raising the GST.

As for the Elizabeth and Salisbury, yes their skills are no longer wanted because WE ALL want to pay someone in Asia to make it for less. So for our friends in E&S the choices are fairly simple. You work for less or re-skill yourself to a skilled area in demand and/or consider relocating. Yes it would be nice for the feds to resolve but these parts of Adelaide have been dying for over a decade with industry closing one by one, only post-poned during the mining boom, but how long do you let your family live in poverty waiting for the govt to resolve before you take control of your own life.

...

However as the companies are Australian the Australian Computer Society includes those numbers in its Australian IT Jobs tally then claims there is a shortage so lets them in on Visa's as well.  Which independent authority checks these figures - the Australian Computer Society of course

My mate who is an experienced Engineer complains about the same rort happening with the Engineers Society (whatever it's called) making money out of assessing overseas trained graduates and then letting them flood into the local market; simply too many people competing for too-few jobs in the Australian market and yet apparently Engineering is still on the skilled shortage list (why?). He tells me that every week he has domestic graduates coming to him and offering to work for nothing just to get experience. Terrible times for some professions when you can't even give your labour away; I feel for those people who spend many years at university doing something they're passionate about only to find that their field is impossible to find paid work in.

Engineering has multiple disciplines and since time begun not all in demand equally and there need for certain disciplines has changed dramatically over the last decade. My field is not longer in demand and I wouldn't recommend anyone going into this field as Australia offers far less opportunity than it has previously.

The current demand in Engineering is in major infrastructure related projects due to the numerous high cost rail and road projects in NSW and Vic and will continue for another 5-10 years.

Electrical Engineering (HV) is also in demand as the nation is expanding the HV network to better manage the RE supply.

In most countries in the world, Engineering graduates work as unpaid interns to get experience to get full time work, both as undergraduate and graduate. Australia has historically been almost unique requiring paid undergraduate work and taken on as a graduate trainee. Even in the UAE with all the oil money, they do not pay even their own under-graduates to get work experience.

Yes it would be nice for the feds to resolve but these parts of Adelaide have been dying for over a decade with industry closing one by one, only post-poned during the mining boom, but how long do you let your family live in poverty waiting for the govt to resolve before you take control of your own life.

Again with the victim-blaming. Not everyone has opportunities, education and success amplified by taking opportunities overseas like you have. You need to be more modest about what you've achieved instead of blaming everyone else (the majority) who don't have mobility or opportunities like you have had.

Agree, that the excuse for not bringing the budget back to balance for last 7 years has been to prevent a recession and I have supported this on the premise it would bring the economy down slowly, prevent a recession and balance the budget with growth. However if we had that recession, that would have come and gone by now and we operating with a balanced budget and debt probably far less than today. At what point when do we say, "enough"!!! We are operating with a perpetual deficit. The problem is that the fed govt budget has so much built in cost with welfare, NDIS etc etc etc that they have little room...

I would have been more inclined to start with -

• Generous entitlements as to how much you can have with private superannuation AND Centrelink. The fastest growing welfare cohort (by far) is age pensioners, 2.2 million and growing quickly. Maybe we should also change the criteria to "residents only" so that the money spent by the taxpayers on pensioners stays in Australia.
• Get rid of the CGT discount on profits from holding onto property. Speculation on these kinds of things should be taxed to the hilt while real productive activity should be taxed as lightly as possible (ie abolish payroll taxes).
• Quarantine deductions from residential property only to income derived from that property - not from other income sources.

They are all pretty reasonable proposals I have listed but would anyone in the Liberal Party even think of those things (or the Labor Party for that matter)? No. Instead all of the proposals have been to trying to undermine and entrench the poverty of those who are already quite poor and/or disadvantaged by continuing to slash at the foundations of our social stability... making the poor poorer.

Forget ever seeing a structural deficit disappear, not for the foreseeable future anyway. It's the new normal. Australia isn't paying its way and we haven't been for some time.

The current demand in Engineering is in major infrastructure related projects due to the numerous high cost rail and road projects in NSW and Vic and will continue for another 5-10 years.

You can't reliably predict that the rivers of stamp duty will keep up, or that the Commonwealth will continue to be able to tip in for these things. Even here in SA we've had huge amounts of Commonwealth money spent here keeping thousands in construction employed but it relies on the fact that the stream of (borrowed) money doesn't give in.

GFC II could put an end to heaps of these government programs ($50 billion submarines, anyone?); although my suspicion is that there will be a lot of social service type programs that get cut before they cut nation-building stuff though.

The current demand in Engineering is in major infrastructure related projects due to the numerous high cost rail and road projects in NSW and Vic and will continue for another 5-10 years.

You can't reliably predict that the rivers of stamp duty will keep up, or that the Commonwealth will continue to be able to tip in for these things. Even here in SA we've had huge amounts of Commonwealth money spent here keeping thousands in construction employed but it relies on the fact that the stream of (borrowed) money doesn't give in.

GFC II could put an end to heaps of these government programs ($50 billion submarines, anyone?); although my suspicion is that there will be a lot of social service type programs that get cut before they cut nation-building stuff though.

There is more than just stamp duty. Also now housing prices are up, this high cash flow will not disappear quickly and also remember while median houses prices exceed 700-900k demand exceeds supply.

How much do you think they will get from the sale of the Snow if the feds go ahead and buy it?

Sale of Westconex and other...

Unlike the feds and SA, NSW has no net debt and because they can only physically build so much rail and road at once, excess cash will be banked, so long as a change of govt doesn't see this pissed against the wall on ideology, the interest is there for the future.

Much of what NSW is adding value into their economy, while submarines are needed to defend the economy, they don't had direct value so SA and the feds will not see a return.

There is a huge range of social schemes that need to be cut before defence.

Yes it would be nice for the feds to resolve but these parts of Adelaide have been dying for over a decade with industry closing one by one, only post-poned during the mining boom, but how long do you let your family live in poverty waiting for the govt to resolve before you take control of your own life.

Again with the victim-blaming. Not everyone has opportunities, education and success amplified by taking opportunities overseas like you have. You need to be more modest about what you've achieved instead of blaming everyone else (the majority) who don't have mobility or opportunities like you have had.

Agree, that the excuse for not bringing the budget back to balance for last 7 years has been to prevent a recession and I have supported this on the premise it would bring the economy down slowly, prevent a recession and balance the budget with growth. However if we had that recession, that would have come and gone by now and we operating with a balanced budget and debt probably far less than today. At what point when do we say, "enough"!!! We are operating with a perpetual deficit. The problem is that the fed govt budget has so much built in cost with welfare, NDIS etc etc etc that they have little room...

I would have been more inclined to start with -

• Generous entitlements as to how much you can have with private superannuation AND Centrelink. The fastest growing welfare cohort (by far) is age pensioners, 2.2 million and growing quickly. Maybe we should also change the criteria to "residents only" so that the money spent by the taxpayers on pensioners stays in Australia.
• Get rid of the CGT discount on profits from holding onto property. Speculation on these kinds of things should be taxed to the hilt while real productive activity should be taxed as lightly as possible (ie abolish payroll taxes).
• Quarantine deductions from residential property only to income derived from that property - not from other income sources.

They are all pretty reasonable proposals I have listed but would anyone in the Liberal Party even think of those things (or the Labor Party for that matter)? No. Instead all of the proposals have been to trying to undermine and entrench the poverty of those who are already quite poor and/or disadvantaged by continuing to slash at the foundations of our social stability... making the poor poorer.

Forget ever seeing a structural deficit disappear, not for the foreseeable future anyway. It's the new normal. Australia isn't paying its way and we haven't been for some time.

We are all victims of change and circumstance, whether it be govt, military, the weather, our health, circumstance etc etc. Its how you deal with it that determines your future. Most of us are in Australia because things went pear shaped elsewhere or believed this was a better option and thus abandoned life, family and friends.

Training in the workplace these days is focus on what you can control, not what you cannot. I cannot control the govt or what they do. I vote once every 3 years, most of what happens next is up to each of us. For some the choices are more limited than others because of their health or others close to them, beyond that.......

I did not get any greater opportunity at school or education at uni than anyone else, according to the HSC marking system at the time, I was technically below average. Being here I obliviously work with 85% of the rest of the population who have chosen to seek better opportunities than whats available at home, regardless of what level of pay they earn.

......

I've said it before,
- break up the income earners into 4
- Bottom 25% pay no tax and get flat rate basic welfare to maintain minimum standard of living.
- Bottom 25% to 50%, as their income rises above 25% their combined welfare payments reduce to 0% when they earn 50%. This is also the lowest tax bracket
- 50% to 75% - Not entitled to welfare payments apart from Medicare, pay mid level tax bracket
- 75% to 100% - Not entitled to any welfare payments apart from Medicare, pay highest level tax bracket

Ask the question, why should someone on 51% average income be entitled to any welfare? What is the limit?

- Housing, remove negative gearing on 2nd hand properties and and CGT discount. I think incentives to build new property is still required as we have a housing crisis.

- School funding, need incentives to get kids out of govt schools and into private as the funding per child is less, but should be sliding scale. Once fees exceed sat $20kpa per say Year 12, the funding is reduced as the affordability by more wealthy parents can pick up the tab.

- Health system, Medicare is not a free for all. There should be no such thing as bulk billing, which is basically Indian Doctors working a production line. There should be a flat rate Co-payment of $10 to all apart from those in the lower 25% who get a Health Care card, then its $5 for GP visit, double for specialist with a cap for lower 25% and higher based on your income tax bracket.

There is more than just stamp duty. Also now housing prices are up, this high cash flow will not disappear quickly and also remember while median houses prices exceed 700-900k demand exceeds supply.

How much do you think they will get from the sale of the Snow if the feds go ahead and buy it?

Sale of Westconex and other...

The cupboard is pretty damn bare for everyone - they recently privatised the Land Titles Office of NSW which I gather was a bit of a world first. The windfall from the privatisation of the power system won't last forever at the rate they're spending it (can't wait till the final cost of the metro line crossing the harbour comes in, I bet that turns out to be billions more than budgeted). You could factor Westconnex sale and maybe (in the future) the NBN will inevitably be privatised for bugger all (hooray for Kevin Rudd) but really future privatisations are not going to save our governments from their falling revenues.

Where does Malcolm get the money for such things (Snowy scheme, submarines, dozens of other big $$$ projects as in the budget)? The answer is that it's all projected expenditure in the future when they actually go though with their special Scott Morrison planning - a bit like the Melbourne-Brisbane railway line that Barnaby Joyce has been strutting around the country crowing about... it ain't gunna start until next decade sometime and even then WHAT IF Morrison's "budget projections" are incorrect - as we've been discussing over the last few pages. Boo hoo, sorry Australia, we'll restart that 'nation building' think just after the election, we promise...

Much of what NSW is adding value into their economy, while submarines are needed to defend the economy, they don't had direct value so SA and the feds will not see a return. There is a huge range of social schemes that need to be cut before defence.

The submarines were completely the wrong thing to try and build here - should have been built in the USA, France or Japan... not here. They are spending billions to import this technology and constructing associated "technology parks" in the hope of attracting other defence industries to Australia - I think that's the vain hope anyway, the excuse for the excess tens of billions being spent.

And there are going to be all sorts of problems with this build escalating the final cost of because we simply don't have the engineering capacity in Australia that we did 20 years ago and it'll have to be purpose built for the project (and then probably never used again). It will be Tunbull's pork-barrel bungle that will leave taxpayers on the hook for extra billions for decades to come.

I guess taxpayers are gunna cop it either way... every Prime Minister leaves a time-bomb for future governments, don't they. Gillard left VET-FEE-HELP and Rudd left National Broadband (not that we'll ever realise the true costs of NBN because it's off the government's balance sheet).

"too many people competing for too-few jobs in the Australian market"

The entire tertiary industry is built on that premise. We have young adults by the hundreds of thousands, gainfully occupied getting useless pieces of paper. They will be qualified for jobs they will never hold.

Underemployment means public subsidies of years spent training is a wasted investment. Though it does keep professors and phd candidates off the streets, I suppose.

"Australia isn't paying its way and we haven't been for some time."

We've been dependant on foreign funding and running deficits since the 1800s. I think that qualifies as 'some time.'

"would anyone in the Liberal Party even think of those things (or the Labor Party for that matter)?"

Both parties have moved leftwards in response to growing nationalism movements.

"The country needs to weed off anyone above 50% income earner from welfare and at the same time potentially find cuts to the lower end to enable the current costs from growing."

Keeping a large welfare class through permanent wealth distribution measures is essential to maintaining the handout mentality. Democracies are built on envy and power; envy of those who have achieved, and power to take from those who have and give to those who need. Classic marxism.

And while I acknowledge the ideological self centredness, Amanda has a point when she talks about who really does the heavy lifting in contributing to government revenue streams:

http://www.canberratimes.com.au/comment/before-you-go-hating-the-rich-get-your-facts-straight-20170421-gvpiuu.html

That said, there is room for modesty when recounting personal achievements. Getting into the higher revenue brackets is no cause for smugness.

"Most of us are in Australia...."

Presuming you meant UAE?

"too many people competing for too-few jobs in the Australian market"

The entire tertiary industry is built on that premise. We have young adults by the hundreds of thousands, gainfully occupied getting useless pieces of paper. They will be qualified for jobs they will never hold.

Underemployment means public subsidies of years spent training is a wasted investment. Though it does keep professors and phd candidates off the streets, I suppose.

Agreed, they're reluctant to do anything to make fees too expensive lest they frighten away people who will subsequently end up on the dole queue. University has become an expensive way of warehousing unemployed; many people who are at uni right now will never end up anywhere near their chosen professions.

Has anyone been following the story of the enormous fraud being perpetrated by executives at the ATO (News.com.au) - these people think that they can operate at a level above the law, obviously.

Trump's deal to sell more American-made bombs to the Saudis appears to make Wall Street happy (ABC).

The tax office is already known for its toxic culture, and the scandal won't do much for internal morale. If anything it will reinforce the general malaise and tolerance of psychopathic behaviour. Predictably, senior management have been attempting to spin it internally as good news, encouraging minions that 'the system works' and that wrongdoers are brought to justice.

http://www.news.com.au/finance/money/tax/ato-boss-coached-staff-to-say-alleged-fraud-was-mainly-fake-news/news-story/9a0dacb5103f86ecc5612bf4e8d3da10

Mainstream media reports have been remarkably selective and careful with their coverage. Perhaps the pr strategy is still evolving, despite the story linked above.

Meanwhile, heres an alternate take on this distasteful episode in Australian kleptocracy:
https://gumshoenews.com/2017/05/19/australian-critters-dragged-from-the-swamp/#more-12131

...................You could factor Westconnex sale and maybe (in the future) the NBN will inevitably be privatised for bugger all (hooray for Kevin Rudd) but really future privatisations are not going to save our governments from their falling revenues..........................................................
........ every Prime Minister leaves a time-bomb for future governments, don't they. Gillard left VET-FEE-HELP and Rudd left National Broadband (not that we'll ever realise the true costs of NBN because it's off the government's balance sheet).

The NBN has nothing to do with Kevin Rudd. It's all Tony Abbott and Malcolm Turnbulls' work.
When a national fast broadband network was first proposed the LNP opposed it, then they proposed using wi-fi entirely and now the hotchpotch of technologies (FTN, HFC, FTC, etc) that is the NBN.

It is planned to eventually sell off the NBN. Its value (and performance) has been greatly decreased by the adoption of questionable technologies that are supposed to reduce costs and having to maintain a multitude of different systems. The so-called current savings are merely costs that have been deferred. Instead of buying infrastructure that is less than 10 years old, the network will include coaxial cable (HFC) that is at least 30 years old and telephone cabling (FTN, FTC) that is 50+ years old. $800m was wasted on the Optus cable network that is 'unfit for purpose' and will not be used. The figures quoted as the total cost of the NBN are not the cost to the taxpayer, or anything like it, as it will generate significant revenue.